Mirant’s
departure could harm expansion
By
Ian Gooding
Trinidad
Guardian
Port
Spain
Petroleumworld.com
08 14 06
The South Trinidad Chamber of Industry
and Commerce (STCIC) is concerned that the departure
of Mirant, which owns 39 per cent of PowerGen, could
seriously affect PowerGen’s expansion plans
and the development of the country.
The STCIC, through a statement by
its Chief Executive Officer Dr Thackwray Driver,
said PowerGen had planned a 208 MW expansion of
its generating capacity with a US$39 million investment.
“Given Mirant’s proposed
departure from T&T by mid-2007, the status of
this much-needed expansion is unsure,” he
said.
Driver said the local demand for
electricity would increase by an average of 4.5
per cent a year for the period 2006 to 2025, due
to planned industrial
expansion.
He termed as “questionable”
calls being made on the Government to re-acquire
its 49 per cent in PowerGen and have PowerGen re-incorporated
into T&TEC.
“The unbundling of power generation
from transmission and distribution has long been
acknowledged as best practice as unbundling promotes
greater economic efficiency across all sectors by
making each individual entity its own profit centre,”
he said.
He said the departure of Mirant
from the Caribbean presented an opportunity for
the regional private sector approach to the purchase
of these assets or for them to be offered on the
stock exchanges on the region.
Mirant owns 80 per cent interest
in Jamaica Public Service Company; 55 per cent interest
in Grand Bahama Power Company; 39 per cent in PowerGen
and 25.5 per cent in Curacao Utilities Company.
In 2005, Mirant’s Caribbean
businesses contributed US$156 million in adjusted
Ebita (earnings before interest, tax, depreciation
and amortisation). Over the last three years, the
company has experienced financial difficulties resulting
in its filing for bankruptcy in 2003. In 2005, it
declared a net loss of US$1.3 billion.
“The decision for Mirant to
exit the Caribbean has implications for T&T,
Jamaica, the Bahamas and Curacao,” said Driver.
“Here in T&T, there has not been any official
statement from the Government.”
He said power generation was a relatively
low-risk investment and one that could bring attractive
returns.
“The opportunity, therefore,
presents itself to offer Mirant’s 39 per cent
share to the local private sector or to make an
offering on the local stock exchange.”
Trinidad Guardian
Sunday 6th August, 2006
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©2006 Trinidad Guardian. All Rights Reserved.
